ACIT-C-17(2), MUMBAI, MUMBAI V. NIRAJ DILIP RANDERY, MUMBAI

ITA 5740/MUM/2019

• Counselvise Citation: [2021] 107 COUNSELVISE.COM (IT) 9802 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 8 month(s) 28 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-06-2021
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2010-2011
• Appeal Filed On: 06-09-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: THARIAN OOMMEN
• Keywords: Bogus purchase; Set aside
• Section: 250; 13

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH, MUMBAI BEFORE SHRI SHAMIM YAHYA, ACCOUNTANT MEMBER & SHRI PAVAN KUMAR GADALE, JUDICIAL MEMBER ITA NO. 5740/MUM/2019 (A.Y: 2010-11) ACIT 17(2), RM NO. 116, 1 ST FLOOR, KAUTILYA BHAVAN, BANDRA KURLA COMPLEX, MUMBAI 400051. VS. NIRAJ DILIP RANDERY 80, NAGDEVI STREET, MUMBAI 400003. PAN/GIR NO. : AABPR3683H APPELLANT .. RESPONDENT APPELLANT BY : SHRI THARIAN OOMMEN , DR RESPONDENT BY : NONE DATE OF HEARING 08 .0 6 .2021 DATE OF PRONOUNCEMENT 11 .0 6 .2021 / O R D E R PER PAVAN KUMAR GADALE, JM: THE APPEAL IS FILED BY THE REVENUE AGAINST THE ORDE R OF THE COMMISSIONER OF INCOME TAX (APPEALS) - 58 MUMBAI, PASSED U/S. 143(3)R.W.S147 AND 250 OF THE INCOME TAX ACT, 1961. THE REVENUE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL: 1. WHETHER ON THE FACTS AND IN THE CIRCUMSTANCES O F THE CASE AND LAW, THE LD. CIT(A) JUSTIFIED IN RESTRICTI NG THE ADDITION MADE BY THE AO @ 12.5% OF BOGUS PURCHASES TO 8.5% OF SUCH PURCHASES, IGNORING THAT THE ASSESSEE WAS A LSO UNABLE TO PROVE THE GENUINENESS OF THE PURCHASES EITHER BY PRODUCING ITA NO. 5740/MUM/2019 NIRAJ DILIP RANDERY, MUMBAI - 2 - THE SUPPLIERS FOR EXAMINATION OR BY FURNISHING OTHE R SUBSTANTIAL DOCUMENTS WHICH WERE REQUIRED BY THE A. O 2. WHETHER ON THE FACTS AND CIRCUMSTANCES OF THE CA SE AND IN LAW, THE CIT(A) ERRED IN ALLOWING OUT OF BOOKS P URCHASES OF RS. 6,99,818/- FROM M/S. SHANTHINATH CORPORATION, W HICH WERE SUPPRESSED BY THE ASSESSEE, HOLDING THAT THERE WAS NO DISCUSSION IN THE ASSESSMENT ORDER SPECIFIC TO THIS , IGNORING THAT THE ASSESSEE WAS UNABLE TO PROVE THE GENUINENE SS OF THE IMPUGNED PURCHASES. 3. WHETHER ON THE FACTS AND CIRCUMSTANCES OF THE CA SE AND IN LAW, THE LD. CIT(A) ERRED IN OVERLOOKING THE FAC T THAT THE ADDITION MADE BY THE A.O WAS BASED ON CREDIBLE INFO RMATION RECEIVED FROM THE SALES TAX DEPARTMENT WHEREIN IT W AS ESTABLISHED THAT THE ASSESSEE HAS TAKEN MERE ACCOMM ODATION ENTRIES BOGUS BILLS FROM THE SUPPLIERS WITHOUT ACTU ALLY MAKING PURCHASES FROM THEM. 4. THE APPELLANT PRAYS THAT THE ORDER OF THE CIT(A) ON THE ABOVE GROUNDS BE SET ASIDE AND THAT OF AO BE RSTORE D. 5. THE APPELLANT CRAVES LEAVE TO AMEND OR ALTER ANY GROUND OR ADD A NEW GROUND WHICH MAY BE NECESSARY. 2. THE BRIEF FACTS OF THE CASE ARE THAT, THE ASSESS EE IS A PROPRIETOR OF M/S. MOTILAL KALINDAS & CO.AND AND IS ENGAGED IN THE BUSINESS OF MILL GAIN STORES MERCHANTS. THE ASSESSEE HAS FILED THE RETURN OF INCOME FOR THE A.Y 2010-11 ON 09.10.2010 DISCLOSING THE TOTAL INCOME OF RS. 40,42,740/. THE RETURN OF INCOME WAS PROCESSED U/SEC143(1) OF THE ACT. THE A.O. HAS RECEIVED THE INFORMATION FROM THE SALES TA X DEPARTMENT MUMBAI & DGIT (INV) WING, MUMBAI THAT ITA NO. 5740/MUM/2019 NIRAJ DILIP RANDERY, MUMBAI - 3 - THE ASSESSEE HAS OBTAINED BOGUS PURCHASE BILLS FROM 13 PARTIES AGGREGATING TO RS.79,16,865/-. THE A.O H AS CALLED FOR THE DETAILS TO PROVE THE GENUINENESS OF PURCHASE OF GOODS. WHEREAS, THE A.O AFTER CONSIDERI NG THE VARIOUS FACTS AND THE PURCHASE DOCUMENTS FILED B FOUND THAT THE ASSESSEE WAS DEALING WITH OPERATORS AND RELIED ON THE JUDICIAL DECISIONS AND ESTIMATED THE INCOME RS.9,02,131/- BEING @ 12.5% OF NON GENUINE PURCHASE OF RS. 72,17,050/-AND ALONG WITH THE ADDITION OF SUPPRESSED PURCHASES OF RS 6,99,816/- AND ASSESSED THE TOTAL INCOME OF THE ASSESSEE OF RS . 56,44,690/-AND PASSED THE ORDER U/S 143(3)R.W.S147 OF THE ACT ON 14.12.2015. 3. AGGRIEVED BY THE ORDER, THE ASSESSEE HAS FILED A N APPEAL BEFORE THE CIT(A). THE CIT(A) CONSIDERED TH E GROUNDS OF APPEAL, SUBMISSIONS OF THE ASSESSEE AND FINDINGS OF THE A.O. AND HAS RESTRICTED THE ADDIT ION OF INCOME @8.5% OF BOGUS PURCHASES AND DELETED ADDITION OF SUPPRESSED PURCHASES AND PARTLY ALLOWE D THE ASSESSES APPEAL. 4. AT THE TIME OF HEARING NONE APPEARED ON BEHALF O F THE ASSESSEE. CONTRA, THE LD. DR SUBMITTED THAT TH E ITA NO. 5740/MUM/2019 NIRAJ DILIP RANDERY, MUMBAI - 4 - CIT(A) ERRED IN RESTRICTING THE ADDITION TO 8.5% O F BOGUS PURCHASES AS AGAINST 12.5% ESTIMATED BY THE A.O. AND ALSO DELETED THE SUPPRESSED PURCHASES. WHEREAS THE A.O HAS RECEIVED THE INFORMATION THAT, THE ASSESSEE HAS OBTAINED BOGUS PURCHASE BILLS AND THE SAME COULD NOT BE OVERLOOKED AND PRAYED FOR ALLOWING THE REVENUE APPEAL. 5. WE HEARD THE LD.DR SUBMISSIONS AND PERUSED THE MATERIAL ON RECORD. THE SOLE CRUX OF THE DISPUTED ISSUE AS ENVISAGED BY THE LD. DR THAT THE CIT(A) HA S ERRED IN RESTRICTING THE ADDITION TO 8.5% OVERLOOKI NG THE FACTS OF BOGUS PURCHASES AND DELETING THE SUPPRESSED PURCHASES. WHEREAS, THE LD.CIT(A) CONSIDERING THE FACTS AND CIRCUMSTANCES AND THE EVIDENCE BOUGHT ON RECORD OBSERVED THAT THE ADDITIO N HAS TO BE RESTRICTED TO 8.5% INSTEAD OF 12.5% BASED ON MATERIAL INFORMATION AND THE TRANSACTION OF SUPPRESSED PURCHASES CANNOT BE TREATED AS BOGUS PURCHASE. THE LD.DR COULD NOT CONTROVERT THE FINDIN GS OF THE CIT(A) WITH ANY NEW COGENT EVIDENCES OR INFORMATION. ACCORDINGLY, WE ARE NOT INCLINED TO INTERFERE WITH THE ORDER OF THE LD.CIT(A) AND UPHEL D ITA NO. 5740/MUM/2019 NIRAJ DILIP RANDERY, MUMBAI - 5 - THE SAME AND DISMISS THE GROUNDS OF APPEAL OF THE REVENUE . 6. IN THE RESULT, THE APPEAL FILED BY THE REVENUE I S DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 11.06.2021 SD/- SD/- ( SHAMIM YAHYA ) (PAVAN KUMAR GADALE) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI, DATED 11.06.2021 KRK, PS / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. / THE CIT(A) 4. ( ) / CONCERNED CIT 5. !!' , $ % , / DR, ITAT, MUMBAI 6. () * + / GUARD FILE. / BY ORDER, ! //TRUE COPY// 1. ( ASST. REGISTRAR) ITAT, MUMBA I